Stocks, interest rates and dollar climb on strong job report

NEW YORK (AP) — The S&P 500 was on pace to erase its losses from earlier in the week, and interest rates climbed after a report on Friday showed that the strengthening U.S. job market remains on course.

The dollar rose on expectations that the Federal Reserve will see the better-than-expected jobs report as reason to continue its campaign to pull rates steadily higher, even with worries high around the world about a possible trade battle.

The Dow Jones industrial average jumped 212, or 0.9 percent, to 24,628, and the Nasdaq composite rose 63, or 0.8 percent, to 7,505.

JOBS REPORT: Employers added 223,000 jobs last month, more than economists expected and a pickup from April’s hiring rate of 159,000. Wages for workers also accelerated, with pay up 2.7 percent from a year ago. That’s a bit faster than April’s 2.6 percent wage growth.

Employers are continuing to hire even as governments around the world threaten to throw up barriers to global trade, which would hurt revenues for big multi-national companies and tap the brakes on economic growth.

President Donald Trump raised eyebrows when he sent out a tweet ahead of the job’s report release that suggested it may be a good one. Treasury yields and the dollar rose modestly following the tweet, although they had steeper gains after the official release. Because the jobs report typically moves markets, government officials are not supposed to comment on it beforehand.

YIELDS: The yield on the 10-year Treasury note climbed to 2.90 percent from 2.86 percent late Thursday. The two-year yield, whose movements are dictated more by expectations for Fed movement, rose to 2.49 percent from 2.44 percent.

Italy’s anti-establishment 5-Star Movement and right-wing League succeeded Thursday in forming western Europe’s first populist government. It will be headed by a political novice whose first try was rejected four days earlier as too risky for the Italian economy, but the outcome avoids an interim government and a swift return to the polls that investors had feared could end up being a referendum on Italy staying with the euro currency.